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Luxembourg: Personal Taxation

Introduction

This page was last updated on 7 July 2020.

Luxembourg is quite a highly taxed country and there are no special regimes for the foreign employees of 'offshore' companies. The main taxes are income tax, municipal business tax on profits and VAT, which applies to most goods and services.

There are three tax classes: class 1 for single persons; class 1a for single persons with children and single taxpayers over 65; and class 2 for married persons (and civil partners under certain circumstances). Income tax rates are progressive, with a top rate of 42%. Added to this is a contribution to the employment fund, normally at 7%.

 

 

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